A Volkswagen logo at a dealership in London. The unbundling of one of Germany’s closest allies is unavoidably connected with high economic losses, Joachim Lang of the BDI has warned.
Photograph: Getty

German firms operating in the UK must brace themselves for a “very hard Brexit”, the Federation of German Industries has warned, as it called on its members to take precautions or be prepared to face heavy economic losses.

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Speaking at a conference in Berlin, the BDI’s managing director, Joachim Lang, bemoaned the fact that the UK had failed to produce a clear road map of how it planned to extract itself from the EU.

“The British government is lacking a clear concept despite talking a lot,” Lang said. “German companies with a presence in Britain and Northern Ireland must now make provisions for the serious case of a very hard exit. Anything else would be naive.”

He said German companies were “nervously” observing the “zig-zag course” of the British government and the slow-going Brexit negotiations with the EU.

He pointed out the importance for German industry of ensuring as smooth a transition as possible, stressing that Britain remained one of Germany’s most important trade partners.

German companies export about $100bn of goods (£75.8bn) to Britain every year, and German companies employ about 400,000 workers in the UK.

“The unbundling of one of Germany’s closest allies is unavoidably connected with high economic losses,” Lang said. He said the German economy was preparing for all possible scenarios.

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“A disorderly exit by the British from the EU without any follow up controls would bring with it considerable upheaval for all participants,” he added.

German companies felt “not only that the sword of Damocles of insecurity is hovering over them, but even more so that they are exposed to the danger of massive devaluation”, Lang said.

The sectors likely to be most affected by Brexit were the car industry, logistics, energy, finance and insurance.

Lang dismissed suggestions by British negotiators for future customs clearing as unworkable. “They would be associated with a disproportionately high amount of bureaucratic effort, and simply not practical for the day-to-day running of companies,” he said.